Supply Chain Discussion: Connecting Supply Chain and Finance
In this discussion, Russell W. Goodman from SupplyChainBrain talks to Reggie Twigg, the supply chain marketing lead at Anaplan. Anaplan is one of the leading providers of enterprise cloud software in the United States, empowering organizations across industries to see, plan and lead better business outcomes.
He says that as the “heartbeat” of a company, the supply chain impacts every part of a business, from finance to human resources and workforce planning. For example, a retail operation must plan its labour around products and what it has in stock. But also and at the same time, it's vitally important for the supply chain to coordinate with sales and marketing, because that actually creates the product flow, which creates the movement to customers.
“Ultimately, for many organizations, supply chain is the biggest business variable they need to manage. It’s the biggest source of revenue, cost and profitability for the organization. They need to get visibility into it.” - Reggie Twigg
He says that whilst every company function is affected by the supply chain, finance is probably the biggest stakeholder in an organization’s supply chain planning.
“The cost performance — what you report in your financials — is deeply impacted by supply chain”. It is therefore counterproductive for companies to operate in silos when supply chain plans are being planned, decided, and executed.
“Where is finance in those decisions when they're being made? Where is finance in the planning cycles? Innovative organizations have recognized that those two functions need to be very tightly interconnected because one of the biggest costs that an organization can have is in supply chain.” - Reggie Twigg
This again confirms what we know, and what was said by Niklas Hedin in this interview about the rise of worldwide delivery networks from earlier in July. How optimization of the supply chain can be the lever by which organizations can increase their overall competitiveness, productivity and profitability.